Shulou(Shulou.com)06/02 Report--

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While 5G terminal melee is becoming more and more intense, MediaTek's performance is becoming more and more stable. On July 10, MediaTek released a summary report on revenue for June and the first half of 2020. According to the report, MediaTek's revenue in June was NT $25.28 billion, up 21% from a year earlier and 16.1% from a month earlier; revenue in the first half was NT $128.47 billion, up 12.4% from a year earlier; and revenue in the second quarter was NT $67.6 billion, up 9.8% from a year earlier.

MediaTek hit another record monthly revenue this year, mainly due to an increase in shipments of 5G Soc, or smartphones equipped with MediaTek's 5G chip. In the Q1 earnings report, MediaTek explained the revenue growth: mainly due to the increase in the market share of smartphones.

MediaTek released a number of 5G chips in the second quarter, and Huawei Xiaomi OPPO and other manufacturers have also launched a number of models equipped with MediaTek chips, but now it is only the beginning of a war between 5G chips and terminals, and 5G replacement dividends add more uncertainty to the competition pattern of the entire track. MediaTek, which tries to use the Tianyu 1000 series to impact high-end flagship models, is bound to face more key challenges.

It's a good start.

In a complex external environment, MediaTek has been able to maintain continuous year-on-year growth in Q1 and Q2 this year for two core reasons: first, MediaTek launched 5G smartphone chips at the right time, and second, MediaTek has a great degree of power. it can be said that it is fully focused.

At the end of last year, MediaTek's Tianji 1000 became the focus of market attention because of its performance. This year, on the basis of the Tianyu 1000, MediaTek has significantly accelerated the pace of release, improving the matrix of the Tianyu 1000 series and the Tianyu 800 series.

In the second quarter, MediaTek released Tianyu 1000 + and Tianyu 820 successively. Up to now, MediaTek Tianyu 1000 series has three chips: Tianyu 1000L, Tianyu 1000 and Tianji 1000 +, and Tianyu 800 series has Tianyu 800 and Tianji 820 chips.

Tianyu 1000 series and Tianyu 800 series are aimed at flagship models and medium-and low-end models respectively, and the relatively rich chip product matrix coincides with the needs of terminal manufacturers' rapid development of new machines, so MediaTek 5G chips are quickly applied to models of many manufacturers.

At present, OPPO A92s, Huawei Changxiang Z, ZTE Axon 11 SE 5G, Redmi 10X 5G, etc., use Tianyu 820, iQOO Z1 uses Tianyu 1000 +, and OPPO Reno3 uses Tianyu 1000L. The support of "Huami OV" makes MediaTek's 5G chips roll out quickly, and quickly occupy part of the 5G terminal market.

In the 5G chip strategy, MediaTek did not lose time, nor did it lag behind Qualcomm and Hayes Kirin. On the contrary, in the early stage of the 5G sea war, MediaTek kept up with the needs of a number of major manufacturers to quickly release corresponding grades of chips. It can be said that MediaTek did a good job in product positioning and product release time, so it also ate a piece of 5G dividend "cake" in the early stage.

Solve the difficulties of Huawei

In fact, a considerable part of the growth of MediaTek's shipments at 5G terminals comes from Huawei. At the end of May, foreign media reported that Huawei's orders for MediaTek processors increased by 300%.

While Huawei is facing all kinds of risks and sanctions, its data performance is getting better and better. Huawei ranked first in the world in terms of mobile phone shipments, surpassing Samsung in April and May, according to the Counterpoint report. In addition, Huawei accounted for 33.2% of the global 5G smartphone market with 8 million shipments in the first quarter, second only to Samsung.

Huawei's position in mobile phones and its overall layout of the 5G mobile phone market are the core reasons for its current growth and global leadership in the face of adversity. On the other hand, a large number of facts have proved that sanctions pose a great threat to Huawei's mobile phone supply chain, making it impossible for Huawei to contract its own chips through TSMC, which is why Huawei has to actively turn to MediaTek.

It can be said that the proximity of Huawei and MediaTek has enabled MediaTek to share the dividend of Huawei's 5G mobile phone delivery. Although the Huawei phones currently used by MediaTek are medium-and low-end models, shipments of these models are sufficient to bring considerable growth to MediaTek.

There are also many media analysts pointed out that in the case that the self-developed chip may not be able to contract manufacturing at all, Huawei will gradually adopt MediaTek's 5G chip in the middle and high-end models.

This conjecture is reasonable. At present, the best choice for Huawei to replace mobile phone chips is MediaTek, and of course, it does not rule out the possibility of getting close to Qualcomm and Samsung in the future. MediaTek can also achieve sustained growth by meeting Huawei's large demand for 5G mobile phone chips for a long time in the future.

Threats from Qualcomm and Apple

At present, MediaTek's strategy on the 5G chip is to continue to carry more mid-and low-end models of the 5G while continuing to hit the high-end models of the 5G. Although MediaTek has not been able to open up a large market in high-end models, MediaTek's competitiveness in mid-and low-end models should not be underestimated.

But for MediaTek, the biggest threat may yet lie ahead. On the one hand, there have been foreign media reports that Qualcomm and MediaTek will launch entry-level 5G mobile phone processors in the third quarter of this year. Qualcomm already has a rich layout of 5G chips. at present, Qualcomm has a portfolio of chip products such as Snapdragon 765G, Snapdragon 765, Snapdragon 855, Snapdragon 865, Snapdragon 865 +, and has been used in dozens of 5G models on the market. all over the high, middle and low-end models.

This means that MediaTek will have a more fierce head-on collision with Qualcomm in the middle and low-end mobile phone market. In addition, many media have revealed that the price of Snapdragon 865 will continue to decline in the third quarter, or will be reduced by 30%, which may bring a lot of resistance to MediaTek's Tianyu 1000 series covering more models.

On the other hand, although Apple has not launched the 5G model for a long time, it is reported that Apple will build a low-cost phone of less than 2000 yuan and use an A13 processor. Previously, Apple has repeatedly competed for users in the middle and lower end of the market by cutting prices and launching new models.

There is no doubt that Apple's sinking will have a huge impact on the middle and low-end mobile phone market, especially under the blessing of a huge user base, Apple's sinking will make Huami OV feel more pressure in the future, which is obviously not good news for Qualcomm and MediaTek.

The unknown of the high-end market

At present, although MediaTek has a good performance at the beginning of 5G, judging from the current situation of market competition, the status of MediaTek and Qualcomm has not changed fundamentally. Qualcomm is still the preferred high-end chip partner for most Android phone manufacturers.

In addition, MediaTek's 5G high-end mobile phone market is not going as smoothly as expected. When more manufacturers choose to carry Qualcomm and Haisi chips, it means that MediaTek has lost this part of the market and can only continue to try to covet this hard-to-reach market as a punter.

The proximity of Huawei and Xiaomi may be a variable, but it is not yet possible for them to use MediaTek chips on their flagship aircraft.

To some extent, these unknowns are also created by MediaTek itself. Because MediaTek sees 5G as an excellent opportunity to move to the high end, and has paid a lot of R & D and operating costs. However, the 5G era will not open a door for MediaTek to enter and leave freely because of the upgrading of technical standards. The market position, user awareness and manufacturer recognition in and before the 4G era will influence MediaTek's performance in the 5G era.

(official account of Liu Kuang / tr. by Phil Newell) ID:liukuang110

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